Under IFRS, if land is the sole property being leased, and title does transfer at the end of the lease, it should be accounted for as a(n)

a) operating lease.

b) capital lease.

c) sales-type lease or financing lease.

d) rental agreement.

10. Under IAS 17 when should a company classify its leases as finance leases?

a) when the risks and rewards of ownership are transferred to the lessee

b) all leases are finance leases

c) all leases are finance leases except for leases of low-value assets and short-term leases

d) when it is a sale-leaseback lease